The advent of Internet-based electronic commerce (eCommerce) has resulted in increased attention to the relationship between information technology (IT) and business financials. While such considerations have often been made in the past, the focus has been cost reduction. That is, in essence, the IT purchasing organization sought to minimize expenses for IT equipment and operations subject to constraints on what was needed for the business. The prevalence of eCommerce has shifted the focus to revenues. As has become evident, IT is essential for business activities such as advertising, suggesting customer purchases, product comparisons, and customer payment.
That IT is increasingly central to revenue generation will ultimately lead to a fundamentally different relationship between business functions and information technology. In particular, we expect customers to seek capabilities that provide means to manage their IT in terms of business financials. However, prior to the present invention, these capabilities have not been available.
As is known, businesses run their applications using an IT infrastructure (e.g., server, software, network connectivity) typically provided by a third party, referred to as the “service provider.” A service level agreement or SLA provides means by which the expectations of the service provider and the customer can be negotiated with respect to the customer's applications that are hosted by the infrastructure of the service provider. An SLA between an application owner and the service provider defines terms and conditions for this hosting service. The SLA may include expected bandwidth throughput at the network and/or servers, disk space utilization, availability, i.e., up-time of network and server resources, as well recovery time upon failure, and pricing for various levels of service. An SLA may also be between a service provider and a consumer of these services.
Today, information technology is managed in terms of these SLAs which focus on IT considerations, especially availability and response time requirements. Included in this scope are U.S. Pat. No. 5,473,773 issued to Aman et al. which describes an apparatus and method for managing data processing workloads with two or more processing goals (or service level objectives); T. Fujita, “Web Computing Operation Manager for Integrated Network and System Management,” NEC Research and Development vol. 41, no. 4, pp. 318-321, October 2000, which describes business level requirements for service level agreements; A. Dutta-Roy, “The Cost of Quality in Internet-style Networks,” IEEE Spectrum, September 2000, which addresses the implications of service level quality in the Internet and mechanisms for achieving quality objectives; and U.S. Pat. No. 6,073,175 issued to Tavs et al. which describes methods for obtaining different service level information from web page content; the disclosures of which are incorporated by reference herein. While these efforts advance the art in terms of traditional IT management, they do not provide an automated way to relate IT level information (e.g., response times, throughputs) to business financials (e.g., costs, revenues). Rather, such relationships are done separately by analysts or by ad hoc programs.
There is another area that broadly relates to IT management, i.e., computer-based automation of supply chain management. That is, computing capacity can be viewed as a kind of material whose inventory levels must be managed. For example, G. A. Kruger, “Supply Chain Approach to Planning and Procurement Management,” Hewlett Packard Journal, vol. 48, no. 1, pp. 28-38, February 1997, the disclosure of which is incorporated by reference herein, describes the requirements for capacity planning and procurement for supply chain management. Also, U.S. Pat. No. 5,615,109 issued to Eder et al., the disclosure of which is incorporated by reference herein, describes methods for generating feasible, profit maximizing requisition sets. Further, U.S. Pat. No. 5,608,621 issued to Cavency et al., the disclosure of which is incorporated by reference herein, describes how to control the number of units of parts in an inventory. Still further, U.S. Pat. No. 5,946,662 issued to Ettl et al., the disclosure of which is incorporated by reference herein, describes how to optimize inventory levels in complex supply chain networks. Yet, none of these efforts address a central issue: how should the IT layer relate to the business layer. Without this mapping, it is unclear how to apply the art of supply chain management.
Recently, D. A. Menasce et al., “Resource Management Policies for eCommerce Servers,” Performance Evaluation Review, vol. 27, no. 4, pp. 27-35, March 2000, the disclosure of which is incorporated by reference herein, describes a method for relating web response times into discouraged customer requests that can be used for reporting and control of IT resources. The Menasce et al. approach relies on a customer behavior model graph to describe potential customer actions. Also, they do not relate management in business terms to SLAs. Instead, their measure of business impact is shopping-based revenue. This is too limiting in that many customer-provider relationships may exist. For example, Internet Service Providers (ISPs) typically charge residential customers a fixed amount for a connection, depending on the connection bandwidth. However, availability problems will reduce the monthly charge by the amount of downtime incurred.
Further, the U.S. patent application identified as Ser. No. 09/642,526, filed Aug. 18, 2000 and entitled “Electronic Service Level Agreement for Web Site and Computer Services Hosting,” the disclosure of which is incorporated by reference herein, discloses computer-based methods and systems for building, provisioning and executing one or more electronic service level agreements (eSLAs) for Web and other computer hosting services, which specify and enforce service contracts for Web and other computer hosting services. Further, the U.S. patent application discloses a process whereby an eSLA can be used for negotiation, service level monitoring, and enforcement. However, the eSLA system does not disclose automated techniques for managing IT resources in terms of business financials.
Still further, the U.S. patent application identified as Ser. No. 09/716,862, filed Nov. 20, 2000 and entitled “Apparatus, System, and Method for Managing Quality-of-Service-Assured E-Business Service Systems,” the disclosure of which is incorporated by reference herein, discloses e-business service level agreement management techniques for managing quality of service (QoS) assured e-business service systems. Again, however, the e-business SLA techniques do not include automated techniques for managing IT resources in terms of business financials.
To summarize, while IT service level agreements are in wide spread use, no system or automated method connects IT service levels with business financials. As a result, considerable human expertise is needed to report IT service levels in business terms and to optimize IT resource allocations to meet financial objectives.